Study on measures to promote domestic feeder transportation[Abstract]
It is considered that activation of domestic feeder transportation between hub ports and local
ports will contribute to improving the competitiveness of the entire land and sea transportation
network in Japan, reducing physical distribution cost, and promoting modal shift. In the courseof the present study, the Committee for the Promotion of Domestic Feeder Transportation andthe Working Group for the Promotion of Domestic Feeder Transportation were established tosurvey the present status of domestic feeder transportation and identify the associatedchallenges to be addressed. Moreover, some measures to activate domestic feeder transportation
were proposed in consideration of the findings obtained from social experiments in anotherstudy on domestic feeders (Fiscal 2005 Study on the Improvement of Container Handling).

1.

Study items<1> Present status of domestic feeders<2> Challenges to be addressed in domestic feeder transportation<3> Measures to activate domestic feeder transportation２.

Study methods<1> data analysis and questioning survey
To understand the present status of domestic feeder transportation, statistic data including
the results of the Survey on Export and Import of Containerized Cargo were organized andactual conditions were summarized with the cooperation of Yokohama and Kobe CityGovernments.

<2> Summary of results of social experiments
With the aim of discussing activation measures, the results obtained from another study(Fiscal 2005 Study on the Improvement of Container Handling) were summarized.

-1-<3> Committee and workshop activities
In consideration of the outcomes of the above <1> and <2>, workshops were held twice inboth Yokohama and Kobe to summarize the present status of domestic feeder transportationand the associated challenges to be addressed and to discuss activation measures. Theworkshop

members

consistedofporttransportation

businesses,

domestic

shipping

companies, and port managers (Yokohama and Kobe City Governments). Based on theactivation measures proposed through the workshops, committees consisting of experts andgovernment officials were held twice to summarize the measures.
This brief report addresses mainly the status and activation measures of domestic feedertransportation.

３.

Study results(1) Evolution of the amount of domestic feeder transportation
According to the Survey on Export and Import of Containerized Cargo, the total amount ofdomestic feeder transportation including export and import decreased from 235,000t/month infiscal 1989 to 159,000t/month in fiscal 2003. The share of domestic feeders in totaltransportation has also decreased in both export and import. The share in export decreased
remarkably from 4.7% in 1989 to 1.9% in 2003, and the share in import decreased from 1.0% in
1989 to 0.5% in 2003.
Evolution of the amount of domestic feeder transportation( i n 1 0 0 0 t / mo n t h )5.0%250200Share in export

Export

4.0%

150

3.0%

S h a r e i n i mp o r t

100

50

2.0%

1.0%

I mp o r t

0.0%01986

1989

1993

1998

2003

Based on the Survey on Export and Import of Containerized Cargo-2-(2) Domestic feeders

Ports having domestic

There are 33 Japanese ports that have domestic feeders as offeeders (as of January 2005)

January 2005 (see the figure on the right).
The total number of feeders in Japan is 22, of which eight areassociated with Yokohama Port and 15 with Kobe Port.

Kobe Port

Data ba sed o n Fiscal 2005 Guide onYo k o h a ma

Sea Liners published by NaikouJournal●Portshavingdomestic(3) Outline of domestic feeder ships
As of January 2005, there are about ten domestic feeder shipping companies and 24 domestic
feeder ships in service. The ships range in gross tonnage from 350 to 750 GT, and 80% ofthem are 499-GT-class container ships. The container capacities of the ships range from 72 to239 TEU (113 TEU on average), and most of them are between 100 and 199 TEU.

Numbersofdomestic

feederships

different

gross

tonna geclasses

51015(asfor

Numbers of domestic feeder ships for differentof積 載 量 別 内 航 ﾌｨｰﾀﾞｰ船 （ 平 成 17 年 １ 月 現 在 ）container capacity classes (as of January 2005)（単位：隻）（単位：隻）
0( U20n i t : s h i p s ) 0300〜399GT

5101520(Unit: ships)〜99TEU

400〜499GT

100〜199TEU

500〜599GT

200〜299TEU

600〜699GT
700〜799GT

Data based on Fiscal 2005 Guide onSea-3-Liners

publishedbyNaikou

(4) Evolution of the volume of domestic feeder cargo at Yokohama PortIn spite of the substantial decrease in the volume of domestic feeder transportation in Japan,
as noted in 3-(1), the volume of transportation at Yokohama Port is growing steadily. The
amount of domestic containers handled at the port in 2004 was 58,000 and 53,000 TEU foroutgoing and incoming cargo, respectively (75,000-TEU loaded containers and 36,000-TEU
empty containers). The total volume of 111,000 TEU in 2004 (23.4% increase from 2003) isgreater than that in 1998 by a factor of 3.2. Here, the amount of domestic containerized cargo,
which includes domestic feeder cargo, follows the existing scheme of statistic data collection.
In the case of Yokohama Port, which does not have domestic RORO and ferry services, mostof the domestic containerized cargo is considered to be domestic feeder cargo (tramper cargo
is excluded).

Evolutionofthevolumedomestic

containeri zedof

Evolution

ofcargodomestic

containeri zed(loaded and empty containers)(outgoingthevolumeandcargo

incoming( i n 1 0 0 0 (単T位E：千UＴＥ) Ｕ）
02040

6080

100of

( i(単n位1：千0 0ＴＥ0Ｕ）T E U )1200

1 9 9 8Ｈ101998

1 9 9 9 111999

2 0 0 0 12

200020406080

100120Ｈ10

実入空

2 0 0 1 132001

2 0 0 2 142002

2 0 0 3 152003

2 0 0 4 1620041112移出移入

13141516

LoadedOutgoing

E mp t y

I n c o mi n g

Data based on the corresponding yearlyversions of Annual Stati stics of Yokohama-4-Evolution of the volume of domestic(5) Evolution of the volume of domestic feeder cargo

内航コンテナ貨物の輸送機関別輸送量
containerize d cargo (different means of sea

in Kobe Portの推移

The volume of domestic feeder cargo in Kobe

平成10年

1998

Port

11

had decreased after the Great Hanshin Earthquake,then began to increase in 2002 and reached 196,000

1999
2 0 0120
2 0 0131

TEU in 2004.
Feeder

2 0 0142

Ferry2 0 0153

Others

2 0 0164050100150
フィーダー

200
フェリー

Based on the corresponding y early versions of Annual Report of Kobe Port250
その他

300350(単位：千TEU)(in 1000 TEU)

4. Measures to activate domestic feeder transportation(1) Challenges and measures identified from social experiments and other studies<1> Challenges and measures on transshipment bases
a. Development of efficient cargo handling scheme for domestic feeder ships andenhancement of cooperation between port cargo handlers
To handle the cargo of domestic feeder ships efficiently, improvement of terminal layouts,formation of working teams, and installation of cargo handling equipment are required. It isappropriate to discuss the use of multiple berths and joint operation of liners by multiple
feeder shipping companies.
b.

Cost reduction at local and transshipment ports
For domestic feeder transportation to be cost-competitive, cost reduction at transshippingbases (reduction of terminal and short drayage operation costs) is required. Non-cost-related
advantages, such as punctuality of transshipment to main ships, should also be considered.
c.

Development of joint cargo handling scheme
When the cargo of domestic feeder ships is handled at a high-standard terminal facility bymultiple port transportation businesses, it is appropriate to discuss development of a joint
cargo handling scheme to pursue efficiency and cost-effectiveness.

-5-<2> Challenges and measures on transportation modea.

Improvement of services by increasing the size and speed of domestic feeder ships
Presuming that a certain level of load factor can be assured for domestic feeder ships,
increasing the size of ships to reduce cost and improve convenience is beneficial to bothshipping companies and shippers. If the speed of ship is also increased, ports of call can beselected more flexibly so that improved services can be expected. It should be noted,
however, that the relevant laws may be applied differently to larger ships. For example, shipproperty tax and port-related tax may be higher, and extra costs for mariners andconstruction levy may be entailed as stipulated in the three domestic maritime laws
(amended) that became effective in 2004.

b.

Coordination between domestic ship transportation and barge transportation
To activate domestic feeder transportation, mutually-complemented measures making useof the advantages of speedy domestic ships and less-costly barges need to be discussed. To
reduce transportation costs, business models to transport empty containers at low cost as
well as development of empty container depots and information systems must be discussed.
The amount of cargo must be increased by improving domestic feeder transportation
services as a whole. To overcome the negative image of barges, their advantages must be
made known widely.

c.

Cost reduction in domestic feeder transportation through various tax incentivesPossible reductions in transportation cost by reducing ship property tax to the levelapplicable to oceangoing ships * 1 and exempting the domestic ships from fuel tax (oil andcoal taxes) * 2 should be discussed.
* 1 W h e r e a s d o me s t i c s h i p s a r e t a x e d i n r e f e r e n c e t o o n e h a l f o f t h e b a s i s o f a s s e s s me n t , o c e a n g o i n g s h i p s a r emo r e f a v o r a b l y t a x e d i n r e f e r e n c e t o 1 /1 5 t o 1 / 6 o f t h e b a s i s o f a s s e s s me n t .
* 2 D o me s t i c s h i p s a r e mo r e d i s a d v a n t a g e d i n f u e l c o s t t h a n o c e a n g o i n g s h i p s , w h i c h c a n u s e t a x - f r e e o i l .

d.

Marketing and proposal to oceangoing shipping companies and shippers who use domesticfeeders
It is effective to propose the use of the Green Partnership grant system. Moreover, thedemand of domestic feeder transportation should be surveyed, and benefits other than theenvironmental ones such as CO

2

reduction should be identified and suggested to thepotential users.

-6-<3> Challenges and measures on local ports and areasa.

Development of cargo collecting scheme at local ports
It is necessary to pursue coordination between transshipment and local ports as well as
development of a mutually-complemented scheme of port functions. It is appropriate for themanagers of transshipment ports to market their ports to the managers of local ports. To
appeal to the local port managers, it is important to explain clearly how the activation ofdomestic feeder transportation is related to the vision of regional development.

b.

Standardization and sharing of information involving local ports (development ofinfrastructures for port coordination)
It is important to improve shipping services by promoting the standardization and sharing
of information on feeder containerized cargo between local and transshipment ports.

c.

Marketing and proposal to oceangoing shipping companies and shippers who use

domestic feeders (same as the above-mentioned)d.

Cost reduction at local and transshipment ports (same as the above-mentioned)e.

Change in awareness of domestic feeder transportation
Efforts are needed to raise the status of domestic ships to the level of oceangoing ships.
One idea is to classify domestic feeder cargo into the category of foreign-trade cargo in theport statistics.

(2) Measures that provide incentives<1> Measures on transshipment portsa.

Development of domestic-feeder-dedicated berths that can be operated in concert withoceangoing terminals

b. Centralization of information on domestic and oceangoing container transportation*(widespread use of JCL-net)* B e c a u s e d i ff e r e n t i n f o r ma t i o n s y s t e ms a r e b e i n g u s e d f o r d o me s t i c a n d o c e a n g o i n g c o n t a i n e r s , d a t a h a s t o b ei n p u t t w i c e f o r e a c h c o n t a i n e r.

-7-

<2> Measures on transportation modea.

Relaxation of construction approval conditions in a temporary step undertaking** T h i s s c h e me l e v i e s t h e b u i l d e r s o f n e w s h i p s w i t h t h e a i m o f d e mo l i s h i n g e x c e s s i v e o l d s h i p s . E c o n o mi cc i r c u ms t a n c e s h a v e c h a n g e d s i n c e t h e a p p r o v a l o f t h e s c h e me , w h i c h i s n o w a n o b s t a c l e t o b u i l d i n g n e w s h i p s .

b.

Suppression of port charges on large ships
Various port charges depend on the size of ship. Mitigate measures, such as introducing auniform charge system for domestic feeder ships, must be discussed.

<3> Measures on local ports and areasa.

Preferential treatment for the use of quays at local portsb.

Treatment equivalent to oceangoing container ships at local ports, including the use ofberths dedicated to oceangoing shipsc.

Centralization of information on domestic and oceangoing container transportation (sameas the above-mentioned)(3) Possible measures<1> Intensification of feeder bases at transshipment ports
・ At Kobe Port, feeder bases should be intensified by making use of continuous berths andimproving the PC16 terminal layout.
・ At Yokohama Port, feeder stations are difficult to intensify. Therefore, the efficiency ofstopping by multiple terminals should be improved.

<2> Coordination between domestic feeder transportation companies (coordination betweenoperators)
・ Improve the entire cargo collecting ability by providing mutually-complemented services
between domestic feeder shipping companies and barge companies. Space charter systems may
be effective in some shipping lines, but care should be taken not to cause a scramble for cargo.

-8-<3> Coordination between local and transshipment ports (coordination between ports)
On condition that the convenience of shippers is improved, the following measures aresuggested.
・Win support from local ports by explaining how the activation of domestic feedertransportation is related to the vision of regional development and how municipalities are
benefited from the activation.
・ Develop a scheme that allows local port transportation businesses to cooperate in promoting
domestic feeder transportation.
・ To strengthen the partnership of port transportation businesses in local and transshipment
ports, discuss measures to support such businesses.

-9-